Full Year Financial Statement And Dividend Announcement for the Period Ended 30/6/2017

Transcription

1 Listed companies must provide the information required by Appendix 7.2 of the Listing Manual. Adequate disclosure should be given to explain any material extraordinary item either as a footnote of the material extraordinary item or in the "Review of the performance of the group". SPINDEX INDUSTRIES LIMITED Full Year Financial Statement And Dividend Announcement for the Period Ended 30/6/2017 PART I - INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3), HALF-YEAR AND FULL YEAR RESULTS 1(a) An income statement for the Group together with a comparative statement for the corresponding period of the immediately preceding financial year. Group S$'000 % 12 - month 12 - month Change 30/06/17 30/06/16 Turnover 141, , % Cost of sales (109,592) (95,955) 14.2% Gross profit 32,183 28, % Other operating income 1,734 1, % Distribution and selling expenses (2,807) (2,375) 18.2% Administrative expenses (13,641) (14,254) -4.3% Profit from operations 17,469 13, % Financial expenses (134) (167) -19.8% Profit before tax 17,335 13, % Income tax expense (3,300) (2,935) 12.4% Net profit attributable to equity holders of the Company 14,035 10, % Other comprehensive income: Foreign currency translation (1,286) (3,730) -65.5% Total comprehensive income attributable to equity holders of the Company 12,749 6, %

2 Group S$'000 % 30/06/17 30/06/16 Change Interest income % Interest expense (134) (167) -19.8% Depreciation of property, plant and equipment (6,461) (5,913) 9.3% Provision for restructuring cost - 1,500 NM Impairment of property, plant and equipment (652) (651) 0.2% Amortisation of deferred income NM Write-down of inventories (43) (166) -74.1% Foreign exchange gain, net % Gain/(Loss) on disposal of property, plant and equipment 87 (1) NM Notes: 1. NM = Not Meaningful 2. Other operating income increased by 8% mainly due to increase in scrap income. 3. Administrative expenses decreased by 4% mainly due to favourable exchange difference compared with previous year. 4. Net foreign exchange gain was mainly due to the appreciation of US dollar against the various Asian currencies.

3 1(b)(i) A balance sheet (for the issuer and group), together with a comparative statement as at the end of the immediately preceding financial year. GROUP COMPANY 30/06/17 30/06/16 30/06/17 30/06/16 Share capital 13,145 13,145 13,145 13,145 Reserves 84,393 74,298 11,398 10,601 Total equity 97,538 87,443 24,543 23,746 Non-current assets Property, plant and equipment 45,869 43, ,045 Land use rights Deferred tax assets Investment in subsidiaries ,169 12,169 46,395 43,706 12,509 13,214 Current assets Inventories 19,116 18, ,911 Trade receivables 30,054 28,999 4,660 5,492 Other receivables and deposits 2,245 1, Prepayments 1,800 3, Due from subsidiaries (trade) ,022 Due from subsidiaries (non-trade) - - 5, Fixed deposits Cash and cash equivalents 39,018 29,064 11,582 9,769 92,992 82,156 22,472 19,133 Current liabilities Trade payables 19,103 15, Other payables and accruals 15,693 15,215 3,875 4,571 Provision for defects 718 1, Due to subsidiaries (trade) - - 3,097 2,960 Bank loans 3,168 3,834 3,168 - Provision for tax ,262 36,362 10,431 8,594 Net current assets 53,730 45,794 12,041 10,539 Non-current liabilities Deferred tax liabilities 2,433 1, Provision for restoration costs ,587 2, Net assets 97,538 87,443 24,543 23,746

4 Notes: 1. Stocks increased by 4% mainly due to more stock holding of raw materials at year end. 2. Other receivables and deposits increased by 54% mainly due to more tax recoverable as compared to previous year. 3. Prepayments decreased by 50% mainly due to lesser downpayments for capital expenditures on machineries. 4. Fixed deposits and cash and cash balances increased by 33% mainly due to improved collections. 5. Trade creditors increased by 21% mainly due to more raw materials being purchased. 6. Property, plant and equipment increased by 6% mainly due to more capital expenditures on machineries. 1(b)(ii) Aggregate amount of group s borrowings and debt securities. Amount repayable in one year or less, or on demand As at 30/6/2017 As at 30/6/2016 Secured Unsecured Secured Unsecured 3,168-3,834 - Amount repayable after one year As at 30/06/2017 As at 30/6/2016 Secured Unsecured Secured Unsecured Details of any collateral As at 30 June 2017, the Company utilised S$3,168,000 of its banking facility to support one of its subsidaries to enjoy a better interest rate. The bank loan of S$3,834,000 which was secured by the leasehold property of Shanghai subsidairy and a corporate guarantee from the Company has been fully repaid during the year.

5 1(c) A cash flow statement (for the group), together with a comparative statement for the corresponding period of the immediately preceding financial year. 30/06/17 30/06/16 Operating activities Profit before tax 17,335 13,040 Adjustments for: Depreciation of property, plant and equipment 6,461 5,913 Amortisation of land use right Amortisation of deferred income - (369) (Gain)/loss on disposal of property, plant and equipment (87) 1 Interest expense Interest income (93) (63) Write down of inventories Impairment of property, plant and equipment Provision for restructuring costs - 1,500 Provision for defects Reversal of provision for defects (838) (669) Unrealised exchange gain (228) (884) Operating cash flow before working capital changes 23,929 20,269 (Increase) / decrease in: Inventories (841) (933) Trade receivables (1,055) (306) Other receivables and deposits (220) 1,792 Prepayments 1,764 (679) (Decrease) / increase in: Trade payables 3,302 (173) Other payables and accruals Cash flow from operations 27,356 20,020 Income taxes paid (3,539) (3,252) Tax refund Interest paid (134) (167) Interest received Net cash flows from operating activities 24,106 16,664 Investing activities Proceeds from sale of fixed assets Purchase of property, plant and equipment (10,957) (9,251) Net cash used in investing activities (10,705) (9,249) Financing activities Proceeds from bank loans 3,168 3,834 Dividends paid on ordinary shares (2,653) (3,230) Repayment of bank loans (3,834) (108) Net cash flows (used in)/generated from financing activities (3,319) 496 Net increase in cash and cash equivalents 10,082 7,911 Cash and cash equivalents at beginning of financial year 29,820 22,585 Currency alignment on opening cash balances (125) (676) Cash and cash equivalents at end of financial year 39,777 29,820

6 1(d)(i) A statement (for the issuer and group) showing either (i) all changes in equity or (ii) changes in equity other than those arising from capitalisation issues and distributions to shareholders, together with a comparative statement for the corresponding period of the immediately preceding financial year. Share Capital Foreign Currency Translation Reserve Reserve Fund Accumulated Profit Total Reserves Total Equity GROUP At 30 June ,145 (8,205) 3,866 78,637 74,298 87,443 Total comprehensive income for the financial year - (1,287) - 14,035 12,748 12,748 Appropriation to/(from) reserve fund/ accumulated profit (529) - - Dividends on ordinary shares (2,653) (2,653) (2,653) At 30 June ,145 (9,492) 4,395 89,490 84,393 97,538 Share Capital Foreign Currency Translation Reserve Reserve Fund Accumulated Profit Total Reserves Total Equity GROUP At 30 June ,145 (4,475) 3,368 72,260 71,153 84,298 Total comprehensive income for the financial year - (3,730) - 10,105 6,375 6,375 Appropriation to/(from) reserve fund/ accumulated profit (498) - - Dividends on ordinary shares (3,230) (3,230) (3,230) At 30 June ,145 (8,205) 3,866 78,637 74,298 87,443

7 COMPANY Share Capital Accumulated Profit Total Reserve Total Equity At 30 June ,145 10,601 10,601 23,746 Total comprehensive income for the financial year - 3,450 3,450 3,450 Dividends on ordinary shares - (2,653) (2,653) (2,653) At 30 June ,145 11,398 11,398 24,543 COMPANY Share Capital Accumulated Profit Total Reserve Total Equity At 30 June ,145 19,088 19,088 32,233 Total comprehensive income for the financial year - (5,257) (5,257) (5,257) Dividends on ordinary shares - (3,230) (3,230) (3,230) At 30 June ,145 10,601 10,601 23,746

8 1(d)(ii) Details of any changes in the company's share capital arising from rights issue, bonus issue, share buy-backs, exercise of share options or warrants, conversion of other issues of equity securities, issue of shares for cash or as consideration for acquisition or for any other purpose since the end of the previous period reported on. State also the number of shares that may be issued on conversion of all the outstanding convertibles, as well as the number of shares held as treasury shares,if any, against the total number of issued shares excluding treasury shares of the issuer, as at the end of the current financial period reported on and as at the end of the corresponding period of the immediately preceding financial year. The Company did not issue any shares during the financial year ended 30 June (d)(iii) To show the total number of issued shares excluding treasury shares as at the end of the current financial period and as at the end of the immediately preceding year. 30/06/17 30/06/16 The total number of issued shares (excluding treasury shares) 115,365, ,365,000 There were no treasury shares as at 30 June 2017 and 30 June (d)(iv) A statement showing all shares,transfers,disposal,cancellation and/or use of treasury shares as at the end of the current financial period reported on. There were no sales, transfers, disposal, cancellation and/or use of treasury shares for the financial year ended 30 June Whether the figures have been audited or reviewed and in accordance with which auditing standard or practice. The figures have not been audited nor reviewed by the auditors. 3. Where the figures have been audited or reviewed, the auditors report (including any qualifications or emphasis of a matter). Not applicable. 4. Whether the same accounting policies and methods of computation as in the issuer s most recently audited annual financial statements have been applied. Except as disclosed in paragraph 5 below, the Group has applied the same accounting policies and methods of computation in the current financial year as with those in the most recently audited financial statements as at 30 June If there are any changes in the accounting policies and methods of computation, including any required by an accounting standard, what has changed, as well as the reasons for, and the effect of, the change. In the current year, the Group has adopted all the new/revised Financial Reporting Standards which took effect for annual periods beginning on or after 1 July The adoption of the above FRS did not result in any substantial change in the Group s accounting policies.

9 6. Earnings per ordinary share of the group for the current financial period reported on and the corresponding period of the immediately preceding financial year, after deducting any provision for preference dividends. Earnings per ordinary share for the year after deducting any provision for preference dividends:- (i) Based on weighted average number of ordinary shares in issue Previous Latest corresponding period period 30/06/17 30/06/16 (cents) (cents) (ii) On a fully diluted basis Basis earnings per share is computed based on the weighted average number of ordinary shares in issue of 115,365,000 (30 June 2016 : 115,365,000). 7. Net asset value (for the issuer and group) per ordinary share based on issued share capital of the issuer at the end of the:- (a) current financial period reported on; and (b) immediately preceding financial year. Net tangible asset backing per ordinary share based on existing issued share capital as at the end of the year reported on Group Immediately preceding period Company Immediately preceding period Latest period Latest period 30/06/17 30/06/16 30/06/17 30/06/16 (cents) (cents) (cents) (cents) Net asset value per ordinary share is computed on 115,365,000 ordinary shares in issue as at 30 June 2017 (30 June 2016 : 115,365,000). 8. A review of the performance of the group, to the extent necessary for a reasonable understanding of the group s business. It must include a discussion of the following:- (a) any significant factors that affected the turnover, costs, and earnings of the group for the current financial period reported on, including (where applicable) seasonal or cyclical factors; and (b) any material factors that affected the cash flow, working capital, assets or liabilities of the group during the current financial period reported on. The Spindex Group is an integrated solution provider of precision-machined components and assemblies for use in machinery & automotive systems, imaging & printing equipment, consumerlifestyle and healthcare products.

10 Revenue The market for the precision engineering industry remained challenging in FY2017 and business conditions continued to be competitive. Against this backdrop, the Group worked closely with its customers to record a 14% revenue growth from $124.2 million in FY2016 to $141.8 million in FY2017. Revenue by Business Sector FY2017 FY2016 Change S$ m S$ m (%) Machinery and Automotive Systems (MA) % Imaging & Printing (IP) (5%) Others % Total % During the year, the Group maintained stable sales of components for machine tools and delivered higher orders for automotive systems to customers in the automotive industry. Consequently, revenue from the MA business sector rose 10% to $65.7 million. However, demand for imaging and printing components remained weak and this led to lower revenue contribution by the IP business sector. The Group s remaining businesses, categorised under Others, registered good demand for domestic appliances components as customers in the consumer goods industry increased their production. Compared to the previous financial year, revenue contribution from Others recorded a significant jump of 42% to $45.0 million. Profitability As a result of higher turnover, gross profit grew 14% to $32.0 million and gross profit margin remained relatively stable at around 23%. Distribution and selling expenses has risen in tandem with the higher turnover. This increase is offset by the decrease in administrative expenses due to higher exchange gain recorded as a result of appreciation of United States Dollar. There was also no other non-recurring expenses in current year compared to prior year. With increased turnover and overall stable expenses, profit from operations increased 32% to $17.5 million. With the increased profitability, net profit after tax attributable to shareholders climbed 39% from $10.1 million in FY2016 to $14.0 million in FY2017. Cash Flow & Balance Sheet In FY2017, the Group generated net cash inflow of $27.4 million from operations. Part of this cash was utilised for the payment of income taxes, investment in new machineries, repayment of bank loans and payment of dividends to shareholders. Balance sheet of the Group remained strong as at 30 June The increase in inventories, trade receivables as well as trade and other payables was consistent with the higher turnover. Due to improved collections, fixed deposits, cash and cash equivalents rose 33% to $39.8 million. This compares favorably with the low debt level of $3.2 million and provided the Group with added financial flexibility to meet market challenges as well as opportunities. 9. Where a forecast, or a prospect statement, has been previously disclosed to shareholders, any variance between it and the actual results. The result is in line with the sentiments expressed in the prospect statement disclosed in the previous results announcement.

11 10. A commentary at the date of the announcement of the significant trends and competitive conditions of the industry in which the group operates and any known factors or events that may affect the group in the next reporting period and the next 12 months. The Group s operations remain vulnerable to the uncertainties in the global economy. Business challenges, policy uncertainties and foreign exchange volatility will continue to impact group profitability. As such, the Group maintains a cautious outlook for its prospects in the current financial year. The Group will remain vigilant in monitoring market developments and continue to manage business risks prudently. To enhance operational efficiency and competitiveness in the longer horizon, the Group will invest in more equipment renewal and site capacity increases and focus on optimizing work processes as well as resource allocation. The Group will maintain its proactive role in marketing to new customers and work closely with existing customers to expand business allocation from them. 11. Dividend (a) Current Financial Period Reported On Any dividend recommended for the current financial period reported on? Yes Name of dividend Interim Final Dividend type - Cash Dividend rate per ordinary share cents Tax rate - Tax exempt (one-tier) (b) Corresponding Period of the Immediately Preceding Financial Year Any dividend declared for the corresponding period of the immediately preceding financial year? Yes Name of dividend Interim Final Dividend type - Cash Dividend rate per ordinary share cents Tax rate - Tax exempt (one-tier) (c) Date payable The proposed dividends, if approved at the 30th Annual General Meeting to be held on 25 October 2017, will be paid on 16 November (d) Books closure date NOTICE IS HEREBY GIVEN that the Share Transfer Books and Register of Members of Spindex Industries Limited (the "Company") will be closed on 3 November 2017 for the purpose of determining members entitlements to the proposed final dividends of 3.00 cents per ordinary share for the financial year ended 30 June 2017 (the Proposed Final Dividends ). Duly completed registrable transfers in respect of shares in the Company received up to the close of business at 5.00 p.m. on 2 November 2017 by the Company s Share Registrar, Boardroom Corporate & Advisory Services Pte. Ltd., 50 Raffles Place, #32-01 Singapore Land Tower, Singapore , will be registered to determine members entitlements to the Proposed Final Dividends. Members whose securities accounts with The Central Depository

12 (Pte) Limited are credited with shares in the Company as at 5.00 p.m. on 2 November 2017, will be entitled to the Proposed Final Dividends. The Proposed Final Dividends, if approved at the forthcoming Annual General Meeting to be held on 25 October 2017, will be paid on 16 November If no dividend has been declared/recommended, a statement to that effect. Not applicable. 13. If the Group has obtained a general mandate from shareholders for IPTs, the aggregate value of such transactions as required under Rule 920(1)(a)(ii). If no IPT mandate has been obtained, a statement to that effect. The Group does not have an interested person transaction mandate. 14. Confirmation that the issuer has procured undertakings from all its directors and executive officers (in the format set out in Appendix 7.7) under 720(1). The Company confirms that it has procured undertakings from all its directors and executive officers in the format set out in Appendix 7.7 under Rule 720(1) of the Listing Manual. PART II - ADDITIONAL INFORMATION REQUIRED FOR FULL YEAR ANNOUNCEMENT (This part is not applicable to Q1, Q2, Q3 or Half Year Results) 15. Segmented revenue and results for business or geographical segments (of the group) in the form presented in the issuer s most recently audited annual financial statements, with comparative information for the immediately preceding year. Imaging & Printing Machinery & Automotive System Others (see note below) Group 2017 Turnover 31,087 65,720 44, ,775 Segment Results 7,278 13,813 11,092 32,183 Distribution and selling expenses (616) (1,301) (890) (2,807) Unallocated expenses (11,907) Operating profit 17,469 Financial expenses (134) Income tax expense (3,300) Net Profit attributable to equity - holders of the Company 14,035 Assets Trade receivables 5,916 16,970 7,168 30,054 Unallocated assets 109,333 Total assets 139, Turnover 32,765 59,656 31, ,188 Segment Results 7,155 13,169 7,909 28,233 Distribution and selling expenses (626) (1,141) (608) (2,375) Unallocated expenses (12,651) Operating profit 13,207

13 Financial expenses (167) Income tax expense (2,935) Net Profit attributable to equity - holders of the Company 10,105 Assets Trade receivables 5,204 15,410 8,385 28,999 Unallocated assets 96,863 Total assets 125,862 Others include domestic appliances, consumer electronics, data storage, telecommunications and others. Turnover Non-current assets Capital Expenditure S$'000 S$'000 S$'000 S$'000 S$'000 S$'000 People's Republic of China 50,877 48,204 14,954 14,688 2,496 3,809 Singapore 4,640 4, , Asean (excluding Singapore) 27,957 27,944 31,100 27,972 8,370 5,636 USA, Europe and others 58,301 43, , ,188 46,395 43,706 10,957 9,483 Turnover is based on the location of the customers regardless of where the goods are produced. Assets and additions to property, plant and equipment are based on the location of those assets. 16. In the review of performance, the factors leading to any material changes in contributions to turnover and earnings by the business or geographical segments. Overall, group turnover was higher in FY2017 as a result of higher demand from customers in the Machinery & Automotive System sector. Please refer to paragraph 8 above for further details. 17. A breakdown of sales. Group S$'000 % 30/06/17 30/06/16 Change Sales reported for first half year 68,664 61, % Operating profit after tax reported for first half year 7,901 7, % Sales reported for second half year 73,111 62, % Operating profit after tax reported for second half year 6,134 2, %

14 18. A breakdown of the total annual dividend (in dollar value) for the issuer s latest full year and its previous full year. Latest Full Year Previous Full Year Interim Dividend per share (tax exempt one tier) Nil Nil Final Dividend per share (tax exempt one tier) 2,653 3,230 Special Dividend per share (tax exempt one tier) Nil Nil 19. Disclosure of person occupying a managerial positions in the issuer or any of its principal subsidiaries who is a relative of a director or chief executive officer or substantial shareholder of the issuer pursuant to Rule 704(13) in the format below. If there were no such persons, the issuer must make an appropriate negative statement. Disclosure of person occupying a managerial positions in Spindex Industries Limited (the Company ) or any of its principal subsidiaries who is a relative of a director or chief executive officer or substantial shareholder of the Company pursuant to Rule 704(13) are as follows: - Name Age Family relationship with any director and/or Substantial Shareholder Current position and duties, and the year the position was held Details of changes in duties and position held, if any, during the year Tan Choo Tan Chang Chai 71 Father of Nicholas Tan Heok Ting and Granduncle of Foo Fang Haur Executive Chairman of Spindex Industries Limited No Change Since 1989 Foo Fang Haur 42 Grandnephew of Tan Choo Tan Chang Chai and Nephew of Nicholas Tan Heok Ting Business Development Manager of Spindex Industries (Hanoi) Co., Ltd. Since June 2005 No Change Nicholas Tan Heok Ting 37 Son of Tan Choo Tan Chang Chai and Uncle of Foo Fang Haur Executive Director of Spindex Industries Limited since 1 May Managing Director with effect from 1 July No Change

15 BY ORDER OF THE BOARD Tan Choo Tan Chang Chai Chairman 21 August 2017